Read the caselet carefully and answer the following questions:
Telemarketing works best on prospects who have already purchased something from your company or initiated a contact. Explain how Nambiar would get an edge over face-to-face selling who do not have access to call the prospect.
Elucidate how the Indian telemarketing firms would be affected, and discuss how they will react if do-not-call law is enacted in India?
SORRY! Wrong Number
Anil Nambiar has been told not to use the phone in the office. Not surprising, since Nambiar works for a conservative marketing company; he doesn't even have his own permanent seat there.
He is a salesman and according to the company's rule he should be out the whole day meeting customers, not talking over the phone. But Nambiar's problem is that his customers are spread across the city and traveling is tough these days. Days on the road together with bad food have worn down Nambiar's health and he now suffers from acidity and dyspepsia.
Some offices even have an insulting board that reads: "Salesmen not welcome." Which means he cannot just walk in and make cold calls to increase sales. His boss wants him to fulfill his target, but how can Nambiar fulfill that if he is not allowed to use the phone to make appointments? He strongly feels that a telephone is a must if he has to achieve his target and improve on it. But the company thinks providing a telephone to salesmen is a waste of money. What's the way out? Nambiar quits his job in frustration.
Nambiar joins Spectrum Systems. The company is progressive and has a telemarketing department supervised by Geeta Iyer. When he goes to meet his clients Iyer briefs him about his clients and their specific needs. Now his job is mainly to close sales, collect payments and give service. His sale productivity goes up, so does his salary and incentives. Nambiar is happy.
But the happiness may not last long. On 28 June 2003, the US administration introduced what it calls a "do-not-call" list, which would block unwanted telemarketing calls to customers beginning 1 October 2003. If one registers in this donot-call list the government guarantees that one will not be disturbed in one's sleep, nor in the middle of whispering sweet nothings to one's wife or girl/boyfriend. If such do-not-call listers are called, the penalty could be stiff — $11,000, no less. Telemarketers like Iyer could be out of her job if such a law is enacted in India.
Shortly after this announcement there was a stampede to register at the website of do-not-call wmabndcW1 ~Pand at a toll-free number, and around 735,000 phone numbers have already been registered. Customers were so desperate to log in that the website received 1,000 hits every second. Customers have over two months to register in the initial do-not-call list. It is expected that 60 million phone numbers will be listed in the do-not-call list in the first year and the registration will have to be renewed every five years.
By a natural corollary if this law is enacted in India then the fledgling call centres and telemarketers could be wading in troubled waters. Imagine Sheila Saxena receiving a call from Iyer in the middle of the latest episode of some saas-bahu soap opera. Iyer is selling credit cards now. She assures Saxena that "all formalities will be completed by us." When Saxena tells her that she already has a credit card, Iyer changes pitch and flicks to the "handling objections" section of her telemarketing manual.
The script clearly lays down what she should say when the customer raises particular objections. "But our credit card charges only 1.8-per cent interest, the lowest in the business," Iyer says. But Saxena counters: "I don't want an additional card," rather piqued. Iyer intensifies her pitch and looks up this particular objection in her manual and says:
"Madam, we will waive your joining fee." All this while the latest episode of some saas-bahu soap opera is playing on television and Saxena is missing all the treacherous palace intrigues in the Virani family. Expectedly, Saxena slams the phone down on Iyer.
Telemarketing, it would seem from the above episode, is a dirty word and telemarketers like Iyer know it and accept it as a professional hazard. Iyer is given a target of a certain number of prospects every day and she has to work hard to achieve that. Spectrum Systems has to generate so many prospects for its sales executives to convert to sales or its profitability and the salaries of its employees are on the line.
The company has realised that the percentage of orders received through telemarketing is quite high at 4 per cent to 10 per cent (i.e., one in 25 or one in 10 calls) than direct mail at 1 per cent to 2 per cent (i.e., one in a 100 or one in 50 mailings). That is the reason it has established a full-fledged telemarketing department.
Iyer has to meet her sales target and Spectrum has to meet its profitability target to pay the bills. The socio-economic category A (SEC A), which is the most potent and affluent of customers (also the most conscious of their right to privacy), would immediately log on and register in the do-not-call list. That would leave only the emaciated SEC B and SEC C sections of the market to be exploited. Would telemarketers like Geeta have a job and companies like Spectrum Systems stay in business?
Marketing case study 